NHL Labor Dispute Continues

11/01/2012 19:51

The NHL and its Players Association have not met face to face in 13 days, pushing the league imposed lockout to 46 days. Estimates to date reveal the league has lost over $700 million due to game cancellations through November 30, 2012.  ESPN announced today that barring any last minute changes between the sides, the Winter Classic would be cancelled as well. 

 

Over the last 2 weeks neither side has made strong contact with the other, at least until today.  It appears as if today, NHL Deputy Commissioner Bill Daly and Union Special Counsel Steve Fehr renewed contact. Talks allegedly were substantive, and the first positive sign for NHL fans in weeks. Previously, NHL Commissioner Gary Bettman said that the previous owners' offer (last presented on October 16, 2012) was the offer in which sides must negotiate. The main issue at this juncture is the division of revenue between the teams and the players. Sides have already made concessions; however, talks seemingly have stalled. 

 

While talks were stagnant for weeks, some of the NHL's best including: Alex Ovechkin, Pavel Datsyuk, Ilya Kovalchuk, Rick Nash and many more have already made their way overseas to play in Europe during the lockout. With no end in sight, many more will be expected to follow over the coming weeks. Not to mention many of the players get to play for near equal money in front of their home crowds, as a large percentage of players are of European descent. Neither side seems to be all that quick to come to an agreement. 

 

All of the major 4 sports (NFL, NBA, MLB, & NHL) have a players association that "collectively bargains" with the owners to draft a Collective Bargaining Agreement (CBA) that governs the league. The CBA which is negotiated between both sides, typically sets out guidelines such as wages, safety, grievance procedures and other league affairs. When the prior CBA expired at the end of the previous season, technically, the terms and conditions remain in affect, until (1) a new one is negotiated, (2) the union decertifies, or (3) an impasse is reached. Typically, unions remain certified to enjoy the protections of being exempt from anti trust attacks. (The only Union to de-certify was the NFLPA in both 1987 and 2012).  That being said, neither side is happy with the current guidleines, as both sides jockey for position in the battle for revenue.

 

The question is...whom is hurt the most by a continued lockout? From a fan perspective, its neither. Afterall, these players are getting millions of dollars to play a game they love. Owners are making exponentially more than that to run the franchise. The fans don't feel bad for either side, afterall its the fan that's losing out right?

 

What fans fail to see is that hockey, like other sports, and like any other industry, is a business. In fact a BIG business. According to Forbes, the players and owners are fighting over the split of $3.3 billion. The NHL shares around $150 million of that already, with players looking for around $250 million in revenue sharing. Unfortunately, for many teams in the NHL they are not reaping the profits that perhaps is expected out of a professional sports franchise in America.

 

Similarly, like any and all businesses, collective bargaining is a natural process of labor negotiations. The difference is, if Verizon employees aren't happy, they strike. Verizon customers are possibly unhappy but service continues on. When the NHL goes on strike (and/or a lockout) the fans are the ones that feel slighted. Afterall, it's their money that pays for part of this tremendous revenue. In the end no one wins during labor disputes. It took months for the NHL to come back from the last labor dispute.  As many of you will recall, the NHL did not play in 2004-2005 because of a similar labor dispute regarding salary cap structure.  It appears as if the NHL and the NHLPA are waiting for the ice to freeze before an agreement is reached this time.